Bank of America Sues Customer, What Happened to Acting Like Humans?

It is well noted that we live in an overly litigious society. But one small company in Las Vegas isn’t just knuckling under the thumb of a big corporation and the hammer-fist of another big lawsuit.

Instead, the small business is taking the revolutionary view that big business should treat its customers as human beings. This small firm is speaking out and urging face-to-face discussions instead of a constant deluge of lawsuits.

Galaxy Gaming of Las Vegas – the world’s second largest developer, manufacturer and distributor of casino table games and enhanced casino systems – had been dutifully paying on its mortgage on its offices but out of the Nevada desert sky, as far as they were concerned, the small firm suddenly learned it was being dragged into court with its mortgage holder, Bank of America, demanding payment in full of its loans.

Robert Saucier, CEO of Galaxy Gaming, has decided to try a different tact in this discussion. Instead of just slinging charge and counter charge in court, Saucier published an open letter in a newspaper to ask Bank of America to just deal with him face-to-face, like a human being.

In the open letter published in the Charlotte Observer — where Bank of America is headquartered — Saucier urged his company’s former “financial partner” to settle their differences.

Saucier says, “We took this step because what Bank of America is doing through its lawsuits against our company is truly an unfortunate, rash and reckless decision that won’t do anything to resolve our differences and let both sides get back to growing their businesses.”

Saucier points out that his firm never missed a single loan payment so the notice of the lawsuit was a major surprise to him. Galaxy Gaming owes Bank of America $1.1 million, and has monthly payments of $9,159 and a balloon payment of $1 million in 2017.

So, why is Bank of America suing? The October lawsuit filed in Clark County District Court charges that in 2007 Galaxy Games made false statements about its ownership when it took out the business loan. Even though no payments were ever missed, the bank says it was the victim of allegedly fraudulent transfer of assets from a limited liability company to Galaxy Gaming.

Galaxy said in its letter, “While, we were troubled by the chaotic nature of B of A’s affairs and the reality that the building was suddenly underwater, we sustained our commitment to you and faithfully made each and every payment as agreed.”

Saucier said his company’s loyalty “was not returned.”

“Imagine our shock and disbelief when we discovered that your bank filed a lawsuit against our company, pertaining to a ‘performing’ loan,” Saucier wrote. “This action was without any justification and is damaging to our good name.”

The open letter also points out that Bank of America itself is being sued by the U. S. Department of Justice for more than $1 billion and accused of serious crimes by federal prosecutors. “Perhaps this is why B of A has set aside as much as $42 billion in company assets strictly for litigation purposes,” the letter says.

“We do not have that luxury. Indeed, our total revenues are less than your personal compensation package,” Saucier says.

Saucier feels that Bank of America should just take a step back from its immediate resort to a lawsuit and deal with his company fairly. Doing so, he offers, would show Bank of America that there are solutions that don’t have to go through a phalanx of lawyers and costly court actions.

“Menacing lawsuits can only contribute to suppressing potential growth, destroying good jobs and stifling the entrepreneurial spirit that B of A is supposed to support,” said Saucier. “Litigation – whether against us or against B of A – should always be a last resort and never a first option.”

Saucier ended his letter hoping that Bank of America would choose to remember and reassert one of the company’s own published Core Values: “We are aware that our decisions and actions affect people’s lives every day.”

I can’t speak to who is in the right or the wrong here … but I think it’s prudent to reserve judgment.

Commander_Chico

I would like to hire this Saucier guy as my business advisor – on a strictly fee-for-service basis. He seems to know every trick there is. Would not let him near my money otherwise.

Glad he’s beating up on B of A, they are worse.

herddog505

I agree.

While Saucier has a point that banks (and everybody else, for that matter) shouldn’t immediately call their lawyers when there’s a hint of trouble, I also wonder whether BoA has made a mistake or if there really is some chicanery going on.

Call me biased, but a compay based in Vegas that makes casino games doesn’t exactly scream “honest, upright customer” to me.

jim_m

Casino gaming in Nevada is one of the most highly regulated industries there is. The amount of money that the casino can make off of a slot machine or other game is set by regulation. The days of mobbed up casinos are largely in the past.

The only organized crime in the casino industry today are the unions that represent the casino workers.

JWH

You’re biased.

I’m not looking at the fact that he manufactures casino games, but at the fact that Saucier has a history (see article above) and at Galaxy Gaming’s apparently restructuring and asset transfers. Sometimes those kinds of maneuvers are benign or ordinary in nature, but sometimes they are made for some nefarious purpose. But I just don’t have enough information (or knowledge of financial transactions and business organization structures, for that matter) to really form an opinion.

>>Even though no payments were ever missed, the bank says it was the victim of allegedly fraudulent transfer of assets from a limited liability company to Galaxy Gaming.

This sort of thing could screw up the banks lien position and expose them to a loss if the property goes into liquidation. It would be financial malpractice and possibly illegal for the bank to ignore.

Ken in Camarillo

Yes, this might be very similar to what the government did with GM. They transfered the good assets to one entity and created another entity to take the “bad” items. Then claimed that creditors of the old GM had to take recourse against the new entity that had all the bad items.

TomInCali

The dispute stems from a commercial loan
made in 2007 to a predecessor company that sold its assets to Galaxy. As
part of the purchase agreement, Galaxy agreed it would make payments
directly to Bank of America on the prior companies loan, but Galaxy
never intended nor agreed to assume the loan. When the Las Vegas real
estate market crashed, the collateral for the loan significantly
decreased in value and Bank of America subsequently called the loan and
demanded to be paid in full, even though Galaxy faithfully made all
payments. Bank of America then sued Galaxy for the full amount of the
loan.

So Galaxy made payments on the loan, but didn’t agree to assume the loan? That sounds odd. Also, note that BofA first called the loan, and Galaxy apparently refused to pay. It was only then that the lawsuit was filed. The didn’t “suddenly” get sued. And it seems like BofA would be justified in publishing their own “pay us what you owe us, then we’ll talk” kind of open letter.